Kinder Morgan Inc. is restoring natural gas shipments on its Tennessee Gas Pipeline Co. to Mexico after making repairs that triggered a force majeure earlier this week.
Tennessee Gas has resolved issues identified on Oct. 5 that forced the company to isolate and shut some sections of pipe, including the Rio Bravo and Cenagas delivery meters, according to a filing. The force majeure declaration a day later sparked renewed concerns in Mexico about the nation’s dependence on US gas supplies.
Even a small hiccup in US-to-Mexico gas flows can have dire consequences for an electric grid heavily reliant on its northern neighbor’s production of the fuel.
Roughly 75% of Mexico’s gas comes from Texas, making the country the biggest overall buyer of US supplies. American pipeline exports to Mexico have surged during the past decade and a half from about 1 billion cubic feet a day in 2010 to roughly 8 billion now, according to BloombergNEF data.
In the event of outages, Mexico only has about three days of gas supplies in reserves, according to Cuitlahuac Garcia, director of Mexican pipeline operator CENAGAS.
“We don’t have storage facilities but we can find ways to manage the situation,” Garcia said during a media briefing Wednesday. CENAGAS had received a warning that flows could be cut by up to 20% on the outage, sparking a “critical situation” in Mexico, he said.
On Thursday , Garcia said there’s no gas crisis and that Pemex is producing more of the fuel domestically, alleviating shortage concerns.
Mexican President Claudia Sheinbaum has launched an effort to explore fracking in a bid to increase domestic gas production, but has placed limits on where the technique can be employed. Her government has also announced around $8 billion in investment in new pipelines to shore up the country’s gas network.